Future Contracts (agreements to purchase a specified amount of commodity at a given price on a set date in the future)

food shortage drive commodity prices up

quite risky

Margin (commodities)

The percentage of the total sales price a buyer must put up to place an order for stock or a futures contract.

Stock option - Call Option - Put Option

The purchased right to buy or sell a stock

the purchased right to buy a particular stock at a certain price until a specified date

The purchases right to sell a particular stock at a certain price until a specified date.

Market Index

A measure of the market value of stocks

Bull Market

A period of rising stock prices

Bear Market

A period of falling stock prices

Don Jones Industrial Average

Market Index based on the prices of 30 of the largest firms listed on NYSE

Margin Trading

The investor makes a down payment in a portion of the price with the rest financed by the broker

Short Sale

An investor "borrows" shares from the broker and sells them

Blue-sky laws

Laws regulating how corporations must back up securities

Prospectus

A detailed registration statement about a new stock

Market order - limit order - stop order - round lot - odd lot

an oder to a broker to buy or sell a certain security - only if its price is less than or equal to a given limit - if its price falls to a certain level or below - units of 100 shares - different than 100 shares